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FTC Issues Statement and Guidance on 'Native' Advertising

Jan 20, 2016

The Federal Trade Commission (FTC) recently issued two new documents to help companies that choose to use “native advertising,” which consists of advertisements that look like surrounding, non-advertising content. One document is an enforcement policy statement that explains how established consumer protection principles apply to modern media and different advertising formats. The other is business guidance to help companies comply with the policy statement.

In the “Enforcement Policy Statement on Deceptively Formatted Advertisements,” the commission explains that “advertisements and promotional messages that promote the benefits and attributes of goods and services should be identifiable as advertising to consumers.” An ad would be considered deceptive if it misleads consumers by implying or representing that it comes from a party other than the advertiser. If the source of advertising content is clear, FTC said, consumers are able to make informed decisions about interacting with or responding to the advertising.

The Commission also released the “Native Advertising: A Guide for Business” to give examples of when disclosures are necessary to prevent deception and how they should be included in native ads.

“FTC’s guidance is a must-read for advertisers,” said Hogan Lovells US LLP, IDFA’s outside legal counsel, in a memorandum prepared for IDFA members. “Based on several traditional deceptive advertising principles, the application to native advertising is important to understand and consider in developing new advertising.” Members may login here to read the memo.

For more information, contact John Allan, IDFA vice president of regulatory affairs and international standards, at jallan@idfa.org.

 
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